2008 August | IndusLatin

Promoting India Latin America Collaboration

As Food Prices Soar, Brazil and Argentina React in Opposite Ways

August 27th, 2008 Posted in Agriculture, Argentina, Brazil, Commodities

And South America’s agricultural powerhouses, Brazil and Argentina, are responding to the farming windfall in opposite ways.

Mr. da Silva’s government recently announced record farm credits, a form of indirect subsidy, to encourage Brazil’s farmers to produce more while the price of their exports are high on world markets, a move that should improve Brazil’s economy. But Argentina, Brazil’s economic and political archrival, decided to share the agricultural windfall at home.

Worried about the wave of inflation rippling around the world, the government of President Cristina Fernández de Kirchner of Argentina increased export taxes on some crops, a move meant to keep down domestic food prices by encouraging farmers flush from global profits to sell more at home.

“In our country the government is trying to get money to subsidize other sectors of the economy,” said Eduardo Cucagna, president of FN Semillas, an Argentina seed company, objecting to the policy. “I think Brazil is doing the opposite, adapting to what the world is offering now. They’re doing it right.”

In the race to take advantage of the tight global food market, Brazil has a number of advantages over its southern neighbor. It is much bigger, with around 173 million acres of land currently under cultivation, more than twice that of Argentina. It has a wider range of agricultural exports. And while Argentina is the world’s second biggest exporter of corn and the third biggest exporter of soybeans, Brazil is the world’s first or second largest exporter of beef, soybeans, orange juice, chicken, sugar and coffee.

The [Brazilian] government’s main goals are to help producers expand onto available land and increase productivity on their current land. It estimates there are up to 220 million unused acres available for planting.

[M]any trade analysts believe both countries will eventually benefit from the run-up in global food prices.
“They have different approaches to what is happening in the world
agricultural markets,” said Simla Tokgöz, an international grain
analyst at the Food and Agricultural Policy Research Institute, an
research center based in Iowa. But “short-term volatility happens in
all countries. In the long term, Argentina has great potential to
increase production and to continue to be a major exporter of grains
and oil seeds.”

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The new geopolitics of Latin America

August 26th, 2008 Posted in Economics - Indicators, Policy and Trends, Infrastructure, Latin America

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INTERMEX POWER

the ability to join natural resource
wealth to value-added industry is positioning the region to become an
important player in the global economy of the 21st century.

Intra-regional
trade is both the driving force and the benefactor of these changes.
New roads being built across the Andes will link the Atlantic and
Pacific Oceans for truck and rail traffic — opening land for
agricultural production and opportunities for the poor to escape
poverty.

The mineral wealth of the Andes — gold, silver, iron, copper, zinc, tin, manganese and other exotic metals — could fuel the global economy for centuries.

The potential for growth is clear from the transportation and infrastructure projects already being planned.

High speed master plan

The Inter-American Development Bank is now studying 14 possible passes over the Andes between Chile and Argentina.

A new highway for high-speed truck traffic will link Buenos Aires to São Paulo. A master plan for transportation and energy for the Andean countries was recently completed by the Andean Development Corporation.

From sea to sea

Road and pipeline networks to handle intra-regional trade among the Mercosur countries, crossing Paraguay and Bolivia, are almost complete.

As intraregional trade grows and trade routes cross the interior, they unlock rich agricultural potential to produce for global markets — and the inland countries will occupy a more strategic role in the economic development of the region.

Newly privatized railroads are being modernized, providing intermodal transportation corridors from the Atlantic to the Pacific.

Argentina’s Ferrosur Roca now allows direct rail shipment to Asia — with truck links to Valparaiso, Chile.

Brazil is constructing one of the world’s largest rail links, the 3,100-mile Ferronorte, to enable grain producers in the interior to reach global markets.

Trains on the pampas, which only a few years ago took days to travel 70 miles to ports on the Parana River, now can carry their grain cargo there in hours.

The role of railroads

The new road from Santa Cruz, Bolivia to Arica on the Pacific coast will reroute traffic — which now has to travel by barge out through the Amazon — thereby reducing the cost of shipping soybeans by $40 a ton and the time to reach Asian markets by half.

The controversial 2,200-mile waterway connecting the Paraguay and Parana Rivers with the Rio de la Plata will, when completed, extend inexpensive river transport from remote areas of Paraguay and Bolivia to the Atlantic Ocean.

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Medical Tourism

August 25th, 2008 Posted in Health and Pharma, India, Latin America, Tourism

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Indian hospital groups like Apollo, Fortis and Wockhardt should takeover hospitals in Latin America to increase outreach to US patients.
BLOG.THEMEDICALROADSHOW.COM:

Americans are living longer than ever before, but at the same time they’re facing challenges presented by out-of-control medical costs and inadequate health insurance. Increasing numbers of U.S. citizens are traveling abroad to avail themselves of Asian and Latin American hospitals and medical centers, for treatments that range from something as simple as getting your teeth whitened, to procedures as major as hip replacement surgery.

According to the most recent census data, 47 million Americans have no health insurance, and 120 million are under-insured. The Commonwealth Fund, a New York-based healthcare research organization, recently issued a report saying nearly half the working-age population of the U.S. risks being financially devastated if confronted with the need to pay for major surgery, either because they have no insurance or inadequate insurance.

Medical Destinations
Some of the major players in this niche in Asia are India, Malaysia, Singapore, Thailand and the Philippines, while destinations in Latin America that are attracting a major share of the market include Argentina, Brazil, Costa Rica, Mexico and Panama.

The India Tourist Board reports that approximately 500,000 medical tourists go to Asia annually. Of this number, India receives 200,000. Medical tourism to India has been growing at 30 percent a year for the past three years, and experts estimate that, by 2012, medical tourism will be a $1 billion industry in India. Presently, the lion’s share of medical tourists traveling to India come from the Middle East, although the U.S. accounts for 10 to 15 percent of the total. It’s clear that it’s a cost-driven decision for many patients. For example, heart surgery can cost $60,000 in the U.S., but might cost $8,000 in India. When you add travel for two, and perhaps a recuperative or holiday stay, you’re still paying a fraction of what the cost would be in the U.S.

“Latin America and Mexico are extremely popular among U.S.
tourists for this form of travel simply because these regions are so close to
the U.S. border and therefore have many doctors that are U.S. certified,” says Willie Moreno, director of operations and registration for the Latin America
division of
Links:
Vacation, Adventure and Surgery

Popularity: 4% [?]

Corn demand hurts tequila industry

August 25th, 2008 Posted in Agriculture, Commodities, Mexico

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USATODAY.com

Here in the heart of Mexico’s tequila country, where every town has a distillery and the air smells like sweet fermenting molasses, a sign proudly marks the entrance to Miguel Ramírez’s farm: “Rancho Ramírez: Producer of Agaves.”

But behind the fence, the blue agave plants, the raw ingredient of Mexico’s famous tequila, are getting harder to spot. They are being replaced by row after row of leafy cornstalks.

That switch to abandon slow-growing agave plants to cash in on corn, beans and other food crops selling for record prices worldwide could limit the supply of tequila and drive up the cost of a shot or a margarita.

The move is part of an international trend from Idaho potato farmers to Bolivian coca growers as they cut back on their trademark crops in hopes of making big money on corn and grain.

“Corn is where the money is now,” Ramírez said, admiring his new crop. “I’m going to get out of agave completely.”

Popularity: 1% [?]

From New York to Mumbai

August 25th, 2008 Posted in Banking and Finance, India

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Views – livemint.com

In a recent opinion piece in the Financial Times, Raghuram Rajan concedes as much when he says that clear limits to the specialization of the developed world in non-traded goods such as financial services are now seen. He adds that as the US reduces its current account deficit, shifts in specialization would take place. He is hinting that the developed world with vastly depreciated currencies in the next year or two might find its competitive advantage restored in manufacturing, while the emerging world might have to depend less on export of manufacture to the developed world. Protectionism and trade retaliation could be counted upon to chip in, too. Therefore, the developing world might have to specialize in the production of non-traded goods.

Which developing countries are better poised to do that? India comes up on top of the list. Enabled by technology, it has already made its mark in trading seemingly non-tradable services. Indians dominate the world of finance in the West. They are in key positions and hence their knowledge and experience count for something. Hence, now is the time to start planning for takeover by Mumbai of the mantle of the headquarters of world of finance from New York/London. Far-fetched? Yes, it is, right now.

Popularity: 1% [?]

Farms in Brazil and India must adapt or roast in heat

August 24th, 2008 Posted in Agriculture, Brazil, India

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New Scientist Environment

Farmers in Brazil and India may suffer less from climate change than previously assumed – if they can continue to adapt to hotter weather, a new study suggests.

Even so the devastation in these countries and other low-latitude countries is going to be much higher than in the northern regions of the rich west, says Robert Mendelsohn at the Yale School of Forestry and Environmental Studies.

Mendelsohn and Apurva Sanghi of the World Bank in Washington DC, used data on weather and the economic success of farming to model the effect of future warming on the predicted income from farming.

For a temperature increase of 3.5% from late 20th-century averages, the model predicts that India will lose between 7 and 17% of its income from farming.

Studies that focus on the biological relationship between weather and crop yield instead of the economic connection between weather and farming revenue, on the other hand, predict a 30 to 40% loss of yield.

what can Brazil and India do to adapt to climate change in the future?

Mendelsohn
believes that switching to crops and livestock that can stand the heat
is going to be crucial. “Irrigation may make Indian farms more robust
now, but water reservoirs may also dry up as the climate warms and many
farms are not near them in any case,” he says.

Popularity: 1% [?]

‘Delivering a global biofuel industry is a big challenge’

August 24th, 2008 Posted in Energy, India, Latin America

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Business Standard

What are the major challenges that the global and Indian biofuel industries face?

The major challenges are to deliver a global industry which is both sustainable and economic; how to be able to introduce new technologies which have the potential to transform the industry; and to work with the agriculture sector to make sure that we bring the interests of energy and nutrition together.

What are the problems that confront the existing market regulatory mechanisms and how can that be set right?

In developmental economics, we are often told that one of the major challenges in the biofuels industry is the failure of market mechanism which has stopped people from investing and producing food as efficiently as possible.

My only point is that rather than making a simplistic assumption that the introduction of biofuels has caused the food versus fuel controversies, biofuels have the potential to be part of some solution to these problems.

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India’s July vegetable oil imports down 3 pct y/y

August 24th, 2008 Posted in Argentina, Brazil, Commodities, India

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UPDATE 1-| Reuters

India’s edible imports fell 3 percent in July from a year earlier, but are on course to remain in the range of 550,000-600,000 tonnes a month for the remaining three months of the oil year, a trade body said on Wednesday.

Imports by India, the world’s biggest buyer of vegetable oils after China, dropped to 532,456 tonnes in May from 548,908 a year earlier, the Solvent Extractors’ Association of India (SEA) said in a statement.

“Imports in July fell due to lower imports of soyoil after Argentina imposed an export duty of 42 percent,” said B.V. Mehta, executive director of the trade body.

A protest by farmers in Argentina led to the roll back of the duty last month.

India imports almost half of its annual consumption of around 11 million tonnes of vegetable oil, buying palm oil from Malaysia and Indonesia and soyoil from Brazil and Argentina.

Edible oil purchases in the first nine months of the season that began in November were at 3.63 million tonnes, against 3.29 million tonnes in the same period a year earlier, the body said.

Mehta said falling prices of cooking oils usually leads to an increase in demand but it was too early to gauge the impact as traders who had contracted at higher prices were in a tight spot.

In the last two months, crude palm oil, RBD palmolein and soybean oil prices have tumbled by about $350 per tonne and sunflower oil has crashed by $630 due to bearish trend in international market, the trade body said.

Popularity: 1% [?]

Answers to questions a resurgent India seeks!

August 24th, 2008 Posted in India, Philosophy and Culture, Science and Innovation

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- Corporate Dossier-Features-The Economic Times

Indian youth have a huge amount of dissatisfaction, hopefully a divine discontent , and they can change things around. They have three strengths: first, persistence, second, innovation, and third, happiness. These are distinctive and are rooted in our history and genes.

PERSISTENT INDIA

Two anecdotes exemplify this:

Ramesh, a tea boy in Shahjehanpur, UP, once insisted on conversing in English. “I want to practice with you and pass TOEFL, so that I can go to America. 500 English words are enough to pass TOEFL,” he said with a ‘can-do’ look on his face.

In Mithapur, Gujarat, I asked Arvind Chudasama, a micro-entrepreneur , supported by a Tata Chemicals outreach activity, about the state of his ice cream business. Bad, he replied. Power cuts. So what about his loan? “I took a second loan to buy a chakda (like a jugad, intervillage transport contraption). I make enough to repay the loan and to invest in a battery to power the ice cream machine ,” he said, full of confidence.

Living in India is like running an obstacle race. One is overcoming obstacles , every day and all the time – poor schools, crowded cities, corrupt officials , unhelpful agents of governance. Indians have the freedom of democracy but not the liberty that is supposed to accompany democracy.

Only when common people can get ordinary, day-to-day things done without a hassle can we say that Indians have the liberty of democracy. “In India, democracy is flourishing, liberty is not,” to borrow from Fareed Zakaria’s comment (The Future of Freedom ). But let us not despair, these things take time. 80 years after the Declaration of Independence, the US was fighting a civil war. Our democracy is maturing. In the meanwhile, the never-say-die and can-do spirit of Indians like Ramesh and Arvind Chudasama holds great hope for the future. Persistent India.

INNOVATIVE INDIA

Indians solve problems. Indians are entrepreneurial in their genes and through their history. They are restless, constantly seeking new ways of doing things. They can be almost exasperating in this respect.

Dharnidhar Mahato (Balakdih, Bengal ) developed a Rs. 500/- cycle pedal paddy thrasher, which costs one-fifth and produced twice the output of a regular thrasher. Arindam Chattopadhyay (Bankura, Bengal) developed a single finger pen so that the handicapped could write (Ref: Honey Bee, National Innovation Foundation, March 2008).

The message is that India can innovate big-time like the Param and Eka supercomputers , the Nano car and the offshore software delivery model. Indians have also democratised innovations like the cycle pedal paddy thrasher and single finger pen.

For innovation to be valuable, there has to be ambition. The ambition of young Indians has increased, so the innovative spirit is poised to deliver big time. Innovative India.

HAPPY INDIA

JRD Tata once said, “I do not want India to be an economic super-power . I want India to be happy.”
The MTV Networks International published a well-being index, according to which ”young Indians are the happiest people on the planet” . Among people in the age group of 16-34 , Indians reported 60% happiness, at about the top end along with Argentina which was 70%. Guess who was miserable at the lower end? Japan at 8% and America at 30%.

Kelly Services, a Fortune 500 staffing leader company found that Indians ranked first in Asia-Pacific in employee satisfaction and seventh out of 28 countries globally, with Denmark, Mexico and Sweden at the top and, Hungary, Russia and Turkey at the bottom.

The Vedanta says that instead of searching for happiness outside of oneself, one should look for infinite joy and peace within oneself.

Here is the story of a happy Indian from modern times.

A young man, who was working in the Indian Army, could not find meaning in his life. So he decided to commit suicide. He chanced on an inspiring book by Swami Vivekananda. He took premature retirement from the army, collected Rs 65,000, and returned to his village in Maharashtra. He used the money to repair the village well, to close down liquor outlets and to mobilise the villagers to work for their own development . In a few years, his village was proclaimed a model village and he found a new meaning in life.

The name of the village is Ralegaon Siddhi, and the man who put it on the national map is Anna Hazare, who was decorated with a Padma Bhushan for his pioneering work. He found happiness within himself. The sheer adventure and scale of India’s economic growth, with social justice and entrepreneurship as its pillars, is staggering. There are beauty spots in this model and there are warts and moles, too.

This much is beyond doubt: no experiment of balancing growth, entrepreneurship and social justice has been undertaken in human history by any country on such a large canvas. Over the coming decades, India has the real chance of reclaiming its place at the top table in the League of Nations, a position she held for centuries but lost in the last few hundred years.

Popularity: 1% [?]

Vuelve a empeorar el clima económico en la región

August 23rd, 2008 Posted in Economics - Indicators, Policy and Trends, Latin America

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AméricaEconomía – El sitio de los negocios globales de América Latina

“Hay una predominancia muy clara de un clima económico de reducción del nivel de actividad económica. Excepto Paraguay, Perú y Uruguay, todos los otros países registran índices de expectativas de los gastos de capital y de consumo por debajo de 5,0 puntos para los próximos sies meses”, señala el informe. Según el Índice de Clima Económico, una cifra por debajo de 5 puntos indica una evaluación “mala o pésima”.

1. Uruguay (8,0)
2. Perú (7,4)
3. Brasil (6,2)
4. Paraguay (5,8)
5. Colombia (5,6)
6. Costa Rica (5,5)
7. Chile (5,3)
8. Bolivia (4,7)
9. Venezuela (4,5)
10. México (4,4)
11. Argentina (3,9)
12. Ecuador (3,5)

Popularity: 1% [?]